The FSA’s move to launch a consultation paper on pension term assurance tax relief has been praised by a Money Marketing round-table protectionpanel but there are misgivings over how far-reaching any regulatory changes could be.Scottish Widows market director (protection) Nick Kirwan warned of over-regulation as he understands that the FSA may be looking at “Icob-plus” rules, adding an extra layer of requirements for advisers wanting to sell PTA. But Lifesearch managing director Tom Baigrie welcomed extra moves from the regulator to strengthen advice in this area, commenting that without extra supervision, there will be massive potential for the plans to be sold incorrectly and be misunderstood. Baigrie and Bright Grey products director Roger Edwards also warned that while a minority of clients would benefit from pension term tax relief, there is a risk that it could encourage churning in many other cases. Swiss Re technical manager Ron Wheatcroft said A-Day rules could encourage block-transfer of policies, which is “fraught with dangers”. Kirwan says: “If the FSA is looking at Icob-plus, this could be the edge of the wedge.” Edwards says: “I wonder if the Government has done its sums here and whether there will be a turn-round of some sort down the line. Consumers need life cover but even more so they need income protection. If we start to sell protection on the back of tax relief, we may not be looking at real customer needs.”
Earlier this year, extracts from taped conversations between FSA staff investigating an IFA were published in Money Marketing.
Treating Customers Fairly – is it a catchphrase or a reality with providers? IFAs have no choice but to treat customers fairly if we want any sort of long-term relationship. The client has to believe we are treating them fairly and operating in their best interests. But I do not get the same feeling from providers over whether they care about long-term relationships with their customers and certainly it looks as if some pay lip-service to treating customers fairly while in reality doing nothing of the sort.
Multi-manager Investment Manager Selection is entering the corporate pension market through its acquisition of MM Asset Management from Threadneedle.
Protection product providers need to get together for an impartial campaign to promote the need for protection in UK society, according to a group of industry experts. A Money Marketing protection round table last week found overwhelming support for a consolidated campaign but the logistics of competitors coming together will be difficult to overcome. Association […]
In any relationship that matters, professional or personal, you should be upfront with someone if you think they’re making a decision or doing something they might later regret. Being honest with someone and having their best interests at heart, however hard the message, is key to building trust in any relationship. So how does this […]
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